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"Smart Money" BTFATH At Most Furious Pace In Over A Year, 2Y Short-Squeeze Possible

Positioning among "smart money" participants in the markets continues to show major divergences. While large speculators bought S&P 500 contracts at their strongest weekely pace in more than a year - shifting to a net long position - they also increased the net short Russell 2000 position to its 'most short' in five years. Large speculators also bought crude oil after eleven consecutive weeks of selling. In the rates complex, hedge funds maintained their 10Y Treasury long exposure while large speculators sold 2-Y Treasuries at the fastest weekely pace in more than three years to the biggest net short position in five years. - leaving, as BofA warns, 2Y susceptible to a squeeze pull-back. This potential squeeze extends all the way to 5Y as repo rates indicate a massive shortage into month-end.

 

"Smart Money" is buying the S&P, selling Russell, and neutral Nasdaq...

 

As BofA's proprietary positioning indicates, Russell is as short as it has been in a year and S&P and Dow longest...

 

 

2Y shorts are the biggest since 2007...

 

And the squeeze potential extends to 5Y maturities - just look at the extreme shortages implied by these repo-rates (via SMRA)

 

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This won't end well...